Many people complain about public welfare expenses and Republicans have historically made every effort to cut back on federal assistance programs like food stamps, public housing assistance, medicaid, even social security and medicare, but how many people think about the large public assistance program for the rich?
What??? Public assistance for the rich??? Well, yes there is, and it’s a big one. While it is not called an assistance program, the federal government doles out money each year that only benefits the rich. This annual expenditure is growing each year, and is likely to exceed all federal assistance programs for everyone else in the not too distant future.
Have I tweaked your curiosity, yet? OK, here’s the story.
There are 13 federal assistance programs plus Medicaid that cost taxpayers $754 billion in 2018. Medicaid, which is the largest single program cost $400 billion, leaving a total of only $354 billion for the 13 remaining assistance programs.
On the other hand, the federal program that assists the rich in getting richer cost U.S. taxpayers approximately $325 billion in 2018 and is projected to cost $389 billion this year and grow to $914 billion in 20281 while the “official” federal assistance programs are projected2 to grow to $920 billion ($490 billion for Medicaid and $430 billion for the remaining 13 assistance programs).
The federal assistance program for the rich that I refer to is the interest that we pay on the public debt3. These interest payments go to foreign governments, corporations and people who are wealthy enough to purchase U.S. Treasury securities (bills, notes and bonds). By definition, those people are rich. The interest payments do not benefit the needy, do not pay for capital investments, and do not provide any products or services for the government. They are interest payments on our national debt that has been created by the rich4 for the benefit of the rich so that they can reduce their taxes, reap the benefit of increasing government spending and loan their money to the government with the promise of getting it back – with interest. Now is that a good deal, or what?
I don’t see where doling out money to the rich is any different than doling out money to the needy except that the former is totally unnecessary and morally bankrupt. The bottom line is that the interest payments on the debt are essentially a federal program to assist the rich in getting richer. So let’s call it what it is – a welfare program for the rich.
1 2019 Congressional Budget Office projections
2 This projection assumes that the growth of these programs is relatively flat and will not exceed the GDP growth rate
3 That portion of the national debt (approximately $22 trillion) owed to the public which is approximately $15 trillion.
4 It is the wealthy and influential people who subsidizes the political campaigns of our legislators who in turn enact fiscal policies that benefit their benefactors.