Wednesday, December 14, 2011

How Much is Spent on Welfare?

Reading some right wingers one might think that the source of all economic problems is black welfare queens having baby after baby in an effort to extract tons of federal welfare dollars so they can live in mansions and drive Cadillacs. OK, maybe that's a bit of an exaggerated description of right wing thinking, but it captures the sentiment.

The actual poor are nothing but the whipping boy. The total amount spent on welfare for the poor is not large. There's a nice break down here. People conflate welfare for the poor with other forms of welfare, like Social Security, Medicare, and Unemployment. The latter are in fact programs that you must pay into in order to receive generally speaking. They aren't targeted to poor people. When you set all that aside and actually look at outlays to the kind of people the right wing have in mind it's not much. 6.4% of the federal budget.

How much is defense? There are different ways of measuring it, but the standard claim is that it's about 20% of the federal budget. And what kind of value does this bring? It's kind of a bad joke. Is there an entity that actually represents a threat to our nation's security? Even with 9-11 the fact is that the threat of terrorism is miniscule, as this interesting report from Cato makes clear.

This kind of expenditure is pure corporate welfare. Our military endeavors certainly enhance the threat of terrorism in this country. Our wars are counterproductive. We knew they would be before we embarked on them and we now know that in fact they have enhanced the threat of terrorism. We'd be better off giving defense contractors the money, but just dropping bombs in our own deserts. Our military adventures overseas are the root cause of Islamic terrorism.

So if you want to blame our economic problems on welfare why not first blame the much larger and much more counter productive corporate welfare that is our military industrial complex. Instead the right wants to blame the much smaller amount of welfare that actually helps poor single mothers.


HispanicPundit said...

Let's not forget military R&D. It's the backbone of our modern technology. We our Apple computers and pretty much modern standard of living to it.

So yeah, I think defense spending is pretty much worth it.

Jon said...

Let's consider this your abandonment of Milton Friedman style economics now that you recognize the importance of the state sector in providing the demand needed to spur technological innovation. I agree 100%. "Defense" is cover for state subsidized high tech. And this is the root of our prosperous economy.

There are places that instead rely on the free market to develop. There's none of the government intervention in the market. Haiti, Latin America, and Africa. That's free markets in action.

We're making so much progress. First you admit Sowell and Williams are clueless on AGW. Now Friedman joins them. Who am I going to point Chad to now when I say "Even right wingers agree with such and such."

A lot of what comes out of the "defense" sector is great. No question about it. But it is welfare for the rich. I worked in defense and I'd watch the government give us hundreds of millions of dollars just to work on things that may or may not go anywhere. The stockholders loved it as do the employees. If you accept welfare for the rich in principle then you must also concede that a little bit of welfare for the poor isn't the root of our economic problems. While I recognize the importance of state subsidized hi tech I can also recognize that a lot of defense spending is worse than waste. It's harmful. So all the bombs we drop, all the tanks we keep running 24 hours a day (consuming an astonishing quantity of fuel), the military bases and embassies we build, this is all unnecessary. We can have state subsidized hi tech without all that, and we can use the money saved to help the poor. So welfare to the poor is not the problem.

HispanicPundit said...

Can you provide proof that Milton Friedman was against government R&D completely? I already showed you a link from the Chicago Boyz (basically Friedman economics) showing otherwise. You make the opposite claim: proof?

I'm curious Jon: do you agree that other countries owe a great part of their standard of living (of which technology is a great part) to our government R&D?

HispanicPundit said...

correction above: to our MILITARY R&D, specifically.

Jon said...

Take a look at the Free to Choose series. Episode 1 is about the beauty of the market. That which is produced is produced because the price signal and free market demand it, not because some Commissar directed it. He talks about how scientific breakthroughs come about because of individuals working in their own interest.

Friedman thinks defense is a legitimate governmental expense, but that's why I noted that what we spend is just not necessary for defense. Yeah, it's called defense. But is it really about defending us? We're not under an outside threat. 9-11 was a consequence of our military adventures and even then the threat of terrorism is miniscule. Prior to that I think you have to go back to 1812 to find the most recent time the US as a country was actually under attack in country.

It's like calling the interstate highways defensive. These just are not defensive. This is just Pentagon spending for economic development. So my point is that since computers, the internet, semiconductors, telecommunications, and the like were not necessary to defend us at the time their development under a "defense" cover would be rejected by Friedman because that's just a cover. He'd say only do what is necessary to actually defend the citizens, since that collective need can't be fulfilled on an individual level. If it's R&D for economic development his position is that you let the demand emerge via free market signals.

HispanicPundit said...

The beauty of the market and individual interest is not mutually exclusive with defense R&D. There are scenarios - like where the cost is overwhelming and the positive externalities difficult to fully capture - where large publicly funded research can play a role.

The idea behind publicly funded R&D is that yes, most of it will be for naught - but occasionally there will be a huge success that swamps all the loses.

Of course, you have to worry about politicizing the R&D. Then the science is dictated not by merit and potential, but by political district interests. That's why many rightwingers are against say environmental type R&D.

I have the Free To Choose series and while it's been a while, I can't remember ANYTHING that would make me think Friedman was against some amount of publicly funded R&D. So your claim to the contrary remains baseless, IMHO. Remember, Friedman was no anarchist (Chomsky however, may have a problem with it - glad to see you expanding your horizons).

Regarding the connection to defense: I disagree. The inventions had a national defense goal. The internet, GPS, etc was to promulgate a specific national defense objective (larger communication, weapon technology, etc). In other words, it was it's specific goal of national defense that lead the researchers specifically in the direction that eventually resulted in the invention.

Now was the threat real? Maybe not. But the researches and the funding certainly thought so. That's all that matters.

Now, can you please answer my question: do you agree that other countries owe a great part of their standard of living (of which technology is a great part) to our military R&D?

Jon said...

Oh, sorry about forgetting your question. You'd probably like a black and white answer, but the answer is it's a mixed bag. The standard of living for a lot of countries has improved thanks to the technology, but we've also seen resource wars which harms a lot of people. Certain resources are in more demand because of technological advancement. Good for some and bad for others.

Of course much of what you say about R&D I've been saying for a long time and I agree with. It's right wingers that fight with me on that normally, but good to have you on my side. But if you are going to just say that as long as it's called defense it's a fine government expenditure then I'll just call welfare for the poor defense. Prevents internal strife and subsequent violence. Actually makes more sense than bombing Iraq.

These expenditures are so not defensive and yes, it is known by many of the recipients. Chomsky's linguistics work was at times funded by the Pentagon. They just give MIT millions of dollars and they hardly care what is done with it. Go do research. And so they spread it around. Chomsky I think said there probably wouldn't have been a linguistics department if not for defense money. There's so much R&D going on and paid for by so called defense monies that it really is a bad joke.

Go watch FTC1 again and I think you'll see what I mean. Nobody directs people what to make. The market signals do. Is that what defense R&D is about? I know first hand that it isn't. They tell us precisely what to do, and we mumble to ourselves that it's a big waste of money. But we do what we are told and we make a lot of money doing it. Watch Friedman talk about Hong Kong and how the key to their prosperity is the fact that the government doesn't do such things. Doesn't come in and tell them what to do.

If Friedman is going to say he supports all the dictates of the Commissars because they said "this is for defensive purposes" even though we know it isn't, then yeah, I guess you're still in the Friedman camp. But at this point the word "defense" loses it's meaning. It just means whatever the government wants to spend money on.

HispanicPundit said...

I never said I followed rightwingers, I said I followed right-wing economists. And this really isn't a right vs left thing, I'd say 90%+ of economists would support atleast a small amount of publicly funded R&D.

Rightwingers probably think you are referring to energy subsides and politicized environmental research. That's the first thing that would come to mind.

And as you said above, Friedman supported a strong national defense. I realize YOU dont think this falls into defense. You have a very unorthodox (and wrong!) view of that, which is fine, but for Friedman - and for me, and for many others - this does fall under defense. And it is both capitalist and matter how much you wish it otherwise.

Jon said...

Linguistics is defense?

HispanicPundit said...

It depends. I wouldn't go so far as to say that EVERYTHING having to do with linguistics is non-defense.

Jon said...

Same for welfare for the poor.

Unknown said...

I've heard this argument many times before. Now just try to imagine the unfathomable amount of technological advancement that completely eliminating military R & D and putting that money towards education would bring? We surely can't predict this for there is no way to prove it but actually doing it, but I would bet on the fact that poverty and hunger would be completely wiped off the face of the planet, way more important that our iPhones and Mac computers if you ask me...