Phony Divide Between Fiscal & Social Issues
Contrary to politicians who want to call a truce about social issues, there is absolutely no way to separate social and fiscal issues; they are locked in a tight political embrace. Politicians who say we can ignore social issues, or avoid talking about them, are really saying that they have no plan to cut federal spending and the growing national debt.
That’s because the social issue of marriage, and its importance to our society, has become a tremendous fiscal issue. The problem of marriage absence is now costing the taxpayers even more than national defense.
We used to have a social structure in the United States where husbands and fathers provided the financial support of wife and children. Last year, 41% of all babies born in the U.S. (including 53% of babies born to women under 30) were illegitimate, growing up without their own fathers.
It is obvious that when the mother of these children has no husband to support her and her babies, she calls on Big Brother Government. You and I then pay the bills for what is labeled welfare. It’s not poverty that causes broken families; it’s the absence of marriage that causes poverty and puts kids below the designated poverty line. Social issues cause fiscal expenses.
I grew up during the Great Depression of the 1930s, and the American family, white and black, was not broken. It stayed together to face life’s reversals.
The massive national problem of having babies without marriage started with Lyndon Johnson’s War on Poverty in the 1960s. LBJ Welfare channeled all the money and benefits to the woman, making the husband and father unnecessary. Charles Murray laid this all out more than 20 years ago. He said “Illegitimacy is the single most important social problem of our time . . . because it drives everything else,” imposing gigantic costs on the taxpayers.
After Barack Obama became President, he increased federal welfare spending by a third because, as he told Joe the plumber, Obama wants to “spread the wealth around.” This was a conscious political strategy; it promotes dependence on government and more votes for the Democrats.
Most Americans are unaware that nearly $900 Billion a year of federal taxpayers’ money is handed out to non-taxpayers allegedly below a designated poverty line. Americans’ lack of knowledge of the enormity of these handouts is why we call it the “hidden” welfare state.
The Heritage Foundation reports that more than 70 types of federal means-tested handouts, in cash or benefits, are distributed. Half of Americans (47%) pay no income tax and depend for their living expenses in whole or in part on government handouts paid by the other half who do pay income taxes.
This federal welfare apparatus includes 12 programs providing food, 10 for housing assistance, 10 for social services, 9 for educational assistance, 8 programs giving cash, 8 for vocational training, 7 for medical assistance, 3 for energy and utility assistance, and 2 for child care and child development. Welfare recipients are eligible for a free cell phone with monthly minutes from the Universal Service Fund that the rest of us pay into.
So we get more illegitimate babies supported by taxpaying Americans every year. This extraordinary change in our social structure is the primary reason that government budgets, both federal and state, are so bloated.
The Rasmussen Poll reports that 78% of American adults rate marriage as at least somewhat important to U.S. society, 60% consider it Very Important, and 77% say it’s better for children to grow up in a home with both their parents. So why are we using tax dollars to discourage marriage and subsidize illegitimacy?
We should ask our presidential candidates who are worried about extravagant government spending, unbalanced budgets, and repeated raising of the debt ceiling, how they will stop the flow of money that promotes more and more dependency on government.
This hidden welfare state is the fastest growing component of government spending. And these figures do not include Social Security or Medicare payments.
Nor do they count the social and fiscal costs of the expensive problems that come mostly from female-headed households: drug addition, promiscuous sex, suicides, school dropouts, runaways, and crime.
Welfare spending is a failure; it doesn’t advance us toward any constructive goal, such as helping recipients to get on their feet economically. It merely increases dependence on government handouts and increases votes for big-spending politicians.
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The Big Issue: Dependency vs. Liberty (Click on graphs to make bigger) |
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Quotes and charts from “The 2012 Index of Dependence on Government” by the Heritage Foundation |
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The average individual who relies on Washington could receive benefits valued at $32,748.
We Can’t Separate Social Policy from Tax Law
Contrary to foolish meanderings of politicians, social issues are not only an integral feature of our fiscal policies but also specifically of our tax laws.
The majority of Americans say they support traditional marriage, the union of a husband and a wife, and support children being raised by their parents who are married to each other. So why are we permitting our income tax law to discriminate against traditional marriage and against the right and need of children to have a father and a mother married to each other?
Don’t let anyone tell you that federal tax policy should be neutral about marriage, children and the family. There is no such thing as a neutral tax or a neutral deduction or a neutral credit.
Every part of your income tax return that you will file by April 15 is a manifestation of social policy. The whole concept that those who have more income must pay higher rates of income tax than those with less income (known as a progressive income tax) is a momentous combination of social and fiscal policies.
It’s social policy that we can deduct gifts to charitable and religious organizations on our tax return. It’s social policy to allow us to postpone taxes on our accounts set up for retirement.
It’s social policy to permit homeowners to deduct mortgage payments. Favoring homeowners over renters was a social-policy decision made years ago and locked into the income tax law.
When we elected the great Republican Congress in 1946, it created the joint income tax return over President Harry Truman’s veto. This enabled married couples, where the husband was the major breadwinner and the wife a homemaker, to file their income tax return as two equal partners, with each tax bracket, deduction and exemption equal to twice that of a single person.
For more than 60 years, the federal income tax treated the family as an economic unit. A husband and wife had the benefit of pooling their income in a joint tax return which affords larger deductions and lower rates.
Meanwhile, pro-marriage social policy was repeatedly reaffirmed by the American people. Thirty states passed constitutional amendments endorsing traditional marriage, and Congress overwhelming passed the Defense of Marriage Act (DOMA). The General Accountability Office reported that 1,138 federal laws depend on the traditional definition of marriage set forth in DOMA.
Nevertheless, starting with the Nixon Administration, fiscal-social policy in the income tax code and in government spending steadily devalued marriage and gave non-marriage a better deal in the income tax law. Tax laws reduced the value of the husband and wife filing a joint return from 2 persons to only about 1.6 persons, while creating a new category called “head of household” for unmarried persons, and valuing that person as 1.4 persons in the income tax system.
We have recently learned that a fourth of those unmarried heads of household have an unreported live-in partner with a job. Simple arithmetic shows that a single parent with an unmarried live-in partner would then be valued at 2.4 persons, which is more favorable tax treatment than respectable married couples struggling to support their own children.
That means, if the single mom has a live-in boyfriend who files his own tax return, they end up with more favorable treatment in the income tax system than a married couple raising their own children. We should not allow marriage to be discriminated against in the income tax code.
Even ObamaCare contains a marriage penalty by reducing the insurance subsidy when cohabiting couples marry. As a Democratic staffer explained to the Wall Street Journal reporter who questioned the marriage penalty written into ObamaCare, “You have to decide what your goals are.”
The Democrats know that 70% of unmarried women voted for Obama in 2008. Democratic consultant Tony Podesta has cooked up 83 bills to increase handing out more taxpayers’ money to single moms.
Most Republican presidential candidates, as well as conservative think tanks, publications and PACs, have presented proposals to “reform” the tax code, but they don’t get it when it comes to income-tax respect for marriage. Again and again, they use such anti-marriage expressions as “individuals and their dependents.”
The only one who seems to understand the family’s relationship to the income tax is Rick Santorum. That could explain his surge with conservative voters.
Santorum even had to explain to the Wall Street Journal’s financial guru the difference between the personal exemption for dependent children and a child credit. The difference is between reducing income taxes on a married couple raising their own children and giving refundable “credits” (a.k.a. handouts) to children of an unmarried parent. It’s time to make our income tax system pro-marriage instead of anti-marriage.
