At the dawn of the 20th Century it still appeared that the principles of the American Revolution of 1776 - limited government based upon individual freedom and responsibility - were securely entrenched, and would continue to be the example to be imitated worldwide as peoples threw off the yoke of tyranny. At that time United States government was both limited and frugal. In total - federal, state, and local - government taxed and spent less than 10% of personal incomes. (See Table 1)

Social welfare expenditures were primarily restricted to universal public education, public health and hospitals, veterans' benefits, and limited relief.[1]  Religious, fraternal and other private organizations provided a widespread network of welfare services in the American tradition of volunteerism.[2] But the primary basis of provision for personal welfare was the traditional family unit headed by a mother and father, and the extended family of blood relatives.

As we prepare to enter the 21st Century we find that American society, the leader of the "free world's" successful overthrow of fascism and communism, has itself undergone a socialist revolution over the course of the past century.

In effect, each traditional family unit which productively supports itself is required to support the equivalent of another whole family in the form of government. As we would expect - according to the maxim that you get less of what you tax and more of what you subsidize - the percentage of individuals living in traditional family units is in a continuing and alarming decline, in favor of the government subsidized "alternative lifestyles."

The first stages of the socialization of American welfare in evidence at the turn of the century were public schools, and public health programs supported by public hospitals, which enjoyed broad public support. The entitlement to free public community schools goes back to the founding of the Republic. However, the transformation to state directed public schools organized on the Prussian model of regimented education to serve the state escaped public concern.[3]  It was "justified" at that time by the rationale of making citizens, soldiers, and workers from the massive wave of immigration then underway. Vital medical care was even then a universal entitlement provided on a charitable basis for the poor by doctors and hospitals. "Relief" for the poor was primarily a varied network of church, fraternal and community based institutions, some supported by local governments. In total, public welfare expenditures, represented only three cents of every dollar of income. (Table A)

This agenda was adopted as a result of the perception of influential elitists that the free market system had failed to ensure American prosperity, and that government intervention was a necessity for both effective management of the economy and provision for individual welfare. It is a bitter irony that such misconceptions were used to justify the American welfare state, given the fact that it was government in the form of the Federal Reserve Board that relentlessly drained liquidity from 1929 through 1932, causing first recession, then depression; and the Smoot-Hawley tariffs of our government that exported depression world-wide.

During the post-World War II period government spending only subsided in part from the total mobilization levels of the war. The "Cold War" kept post-war military expenditures at a highly sustained rate. But social welfare expenditures remained as high as during the Great Depression, replacing relief for the unemployed with spending on education of the baby boom, increasing government retirement entitlements, and welfare for low-income families. Politicians repeatedly raised social security payments to levels far above what the recipients themselves had actuarially provided for with their own contributions, converting Social Security from an insurance program to an income redistribution welfare scheme. By 1960 government at all levels was spending over one-third out of every dollar of personal income. The Cold War was taking 11 cents of every dollar for national defense, but social welfare spending exceeded even that, at 13 cents per dollar. (See Table 1 & Table 2)

During the presidential race of 1960, John Kennedy made the call for a "War on Poverty" the centerpiece of his campaign, setting a $3,000 income for a family of four as the poverty threshold,^[4] and deriding Americans for "private affluence and public squalor." This was fair warning that government spending of over one-third of every dollar of American's income was by no means the limit. The "poverty level" as arbitrarily defined was more than half of the current median family income of $5,800 per year, (Table 3) and higher than the average income of all but a handful of the world's Nations.[5]  Supposedly more than one out of every five Americans lived in poverty at that time according to such a liberal definition. (See Table 4)

It was Kennedy's successor, President Lyndon Johnson, who implemented the war on poverty as his "Great Society," which in retrospect launched the most massive income redistribution by government in American history. By 1992 social welfare expenditures had grown five-fold over the 1960 level in constant dollars to $1¼ trillion dollars per year.
(See Table 1 & Table 14)

Led principally by increases in spending on Social Security and open-ended Medicare and Medicaid entitlements, welfare spending on the aged far outgrew the taxpayers' incomes who paid the bill. The aged consumed half of all welfare spending by 1992. (See Table 5) Incredible as it sounds, social welfare spending on the aged by 1992 averaged $20,000 for every aged person living in America, regardless of means. (See Table 6) The retirees who cheerfully drive their motor homes southward with bumper stickers reading "WE ARE SPENDING OUR CHILDREN'S INHERITANCE" are right on the mark; our national debt has ballooned under this burden for their children to pay - later - since sufficient revenues are not taxed to meet this burden on a current basis. Perhaps such bumper stickers should read "WE ARE CONSUMING OUR GRANDCHILDREN" as well, judging from the drastic drop in both the marriage rate and birth rate of their children. (See Table 7)

Most of the remainder of the welfare burden as of 1992 was divided between public education and welfare, for children in poverty and their adult custodians. (See Table 6) These "children in poverty" welfare expenditures amounted to $20,000 per year per child in poverty. (See Table 6) In total, public welfare expenditures excluding education represented over $25,000 per person in poverty, half again higher than the disposable personal income of the average American. (See Table 6)

Given the public generosity to those 65 years or older, poverty among the aged should be entirely eliminated; yet as of 1993, there are still 12.2% of the aged said to be in poverty. Overall, according to the government one out of every seven persons still remain in poverty. (See Table 4)

Poverty is particularly centered among unmarried mothers and their children, where it would appear that government welfare programs have been fostering the very poverty that they were designed to eliminate. Since the welfare revolution, unwed motherhood has risen from 5.3% of all births in 1960 to 30.1% in America as of 1992, with no end in sight. (See Table 8) At the same time, marriage has been on a severe decline, falling from three out of four households in 1960 to slightly above one out of every two households in 1994. (see Table 9)  Divorces have risen from one for every four new marriages in the early postwar period to one for every two marriages, and the birth rate has dropped by one-third. (See Table 7)

Government welfare programs provide powerful incentives for unmarried motherhood among lower income families; the total welfare entitlement package is over $17,000 per year for the median U.S. state. (see Table 10)  An unmarried mother, with or without a job, receives far higher total income entitlement than if married to a lower income husband. (see Table 11) AFDC, food stamps, Medicaid, housing, utilities, and WIC subsidies allow comfort without work. Most of these benefits remain in whole or in part, even if she goes to work, along with the added entitlements of earned income tax credit, plus transportation and child care subsidies. Even those lower income families where both spouses work and spurn welfare would be better off not to marry, since they lose up to $3,500 of earned income tax credit by marrying. (see Table 12) To state it bluntly, the lower income father cannot compete with the state as a husband, due to the welfare and tax benefits the unmarried mother loses as the result of marriage. This explains the rapidly falling rate of marriage, and rapidly rising rates of unwed motherhood among lower income individuals. The state has used its power to confiscate income to usurp the role of both parent and husband.

The mindlessness of public antipoverty programs that discourage marriage can be demonstrated by the fact that nearly half of female headed families are in poverty, compared with less than one married family in ten[6]- and the female headed families are four times as likely to still be in poverty five years later. Government continues to run a booming growth business in welfare for unmarried mothers, seducing a continuing supply of new clients by the generosity of the welfare and tax credit entitlements - programs adopted to solve the poverty problem that instead add to the "poverty" ranks.

And how have the working majority of citizens reacted to this untenable rise in the American welfare burden they are being forced to shoulder? They likewise have joined the trend toward declining rate of marriage and the rising rate of divorce. (See Table 7) There has been a steady decline in births; following a rise to pre-Depression levels in the earlier postwar period, fertility rates in the U. S. have fallen nearly over one-third since 1960. Without government subsidized births out of wedlock, births would have fallen by one half. The decline of the birth rate in the Depression was an obvious sign of economic distress, as is the present precipitous decline. In addition, unwed motherhood is no longer primarily a minority phenomenon: (See Table 8) the rate among whites reached 22.6% in 1992, and at present growth rates is heading toward 50%. (See Table 8)The rate of conscription of married women into the workforce to help the family survive rose from three out of ten to seven of each ten wives with children, whereas less than one out of eight worked earlier in the century. (see Table 13)

Examination of the recent trend of family income over the 23 years from 1970 to 1993 compared to hours worked clearly demonstrates the economic distress government has imposed upon the traditional married family. Median after tax income of married families in constant dollars failed to grow over this period; (see Table 14) despite the increase of working wives from four to six out of every ten married women. This increased the hours worked per family sufficiently to result in an 8% decrease in the median hourly wage rate of the typical married family after deducting "government's share." Yet during this period output per man-hour of the private economy rose 38% and the incomes of all Americans in constant dollars after taxes (grouped as if married families) rose 23%. (see Table 15)  The whole benefit of the productivity increase went to government and its beneficiaries - while the traditional family bore the working brunt of growth of self- perpetuating welfare schemes. Bear in mind that as dismal a picture of the married families plight as income witnesses, it makes no provision for the added burdens of commuting, child care, and purchased services that largely offset the added earnings of working mothers.

The humorous but incisive C. Northcote Parkinson observed in his study of the history of taxation, The Law and the Profits,[7] that where taxation exceeds one-third of national income, a country is on the road to totalitarianism or revolution. Even the serfs, he noted, would either lay down their tools or raise them in rebellion if the feudal lord sought to take more than one-third of their produce. How do we explain, then, the servile attitude of the citizens of the social democracies toward this preposterous level of confiscation of their incomes, to such an extent that it precludes family life?

Twentieth century governments are more clever than their feudal counterparts. Of the 48 cents of the taxes and fees from each dollar of 1992 income of Americans, only 24 cents was visible. Of the remainder, 20 cents was hidden, primarily in corporate paid fees and taxes, and four cents was borrowed, to be reckoned with at a later date. (See Table 16) Additionally, we have been seduced by utopia sold to us at vastly underestimated cost, with the glib assurance that our perceived benefits would be enhanced by "soaking the rich" to pay the bill - when in fact we each paid dearly.

However, one need not understate the contribution of these forces to conclude from this analysis that the virulently antifamily economic influence of government alone is exerting powerful enough force to account for the decline by preference for economic organization of individuals as traditional family units.

The prospects for family formation would improve dramatically were the following eight objectives to be effected:

• First, government spending at all levels must be cut severely to no more than one-third of every dollar of personal income, and preferably one-quarter. Families could then return mothers to the home and to child rearing, and put to rest the shibboleth that the state is the proper parent of the child.

• Second, all schemes of income redistribution should be phased out in favor of a return to individual, family, and community resolution of welfare for all but assistance to those who are truly incapacitated, and temporary relief of last resort for the capable - as the strictly limited duty of government. This would eliminate perverse incentives that reward irresponsible and unproductive behavior and lifestyles, at the expense of responsible and productive families and individuals.

• Third, all taxes should be visible; whether on income, property, or shown separately from the price of the product or service which bears them. This would provoke a tax revolt long before government could create a burden of the current magnitude.

• Fourth, persons or households should be entitled to no government distribution of welfare which would result in total income in excess of the applicable poverty level, including welfare benefits and shared living arrangements. This would remove perverse incentives for citizens to position themselves for welfare excesses.

• Fifth, the earned income tax credit should be phased out as a misguided incentive to single motherhood. Sufficient incentive to work will be provided by the need for self support through work and marriage once our excessive welfare benefits are corrected.

• Sixth, to minimize the family income tax burden, child allowances should generously reflect the social worth of child rearing. Married couples should receive the same tax privileges as any other legal partnership with the right to split income and deductions without limitation. True human welfare is based upon families, and the government must eliminate all prejudicial tax polices in favor of pro-family policies.

• Seventh, the elderly should pay income taxes on all income, including Social Security distributions, on the same basis as any other citizen. This would remedy the unjust burden of disproportionate taxing of the working family for the benefit of the elderly.

• Eighth, Social Security and Medicare must be resolutely reformed over an agreed transition period to fully funded trust plans, under a privatized system outside of the untrustworthy hands' of government. The present Social Security and Medicare programs place upon working families the unwarranted burden of intergenerational confiscation of their income to subsidize the elderly, regardless of their means, which is funded by an unsustainable Ponzi scheme such that reform is inevitable; the sooner, the better.

The radical curtailment of the role and cost government by implementation of these objectives would result in a rebirth of preference for the family as the fundamental social unit of American civilization. But it would also provide a rebirth of freedom from the creeping grasp of totalitarianism that will inevitably result from any further growth of government - or from even its present size.

Those who reside in the social democracies of Europe face no different problem nor prospect. The decline in birth rates and marriages, along with the rise in illegitimacy and divorces is virtually parallel to that of white Americans. (see Table 17)   Europeans should take no comfort in the fact that our statistics look worse on the surface due to the more rapid disintegration of minority families, (See Table 8) who having lower family incomes on average are all the more keenly pressured by the economic forces cited. The Europeans declining vital statistics bear witness to the same forces at work.

As Allan Carlson so ably portrayed in his comparison of the United States and Sweden in his book, Family Questions,[8]  the future prospects of the welfare states are those of Sweden, which pioneered the socialist welfare agenda for democracies. Today half the births in Sweden are out of wedlock, and marriage is no longer the typical household arrangement. (See Table 16)  The oppressor of European families is identical to that of American families. That oppressor is the socialist welfare state, with its seductions for atomization of individuals and its punitive burden on the productive family.

Back in 1776 the forefathers of America sought the assurance of life, liberty and the pursuit of happiness through limited government. Only by returning to limited government can we restore the quality of life by a return to family life - the bedrock of civilization, and the wellspring of that human happiness.

1. HS70: Series 1-31, p. 340-341.

2. HS70: Series 1 -31, p. 340 - 341.

3. See Gatto, J. T., Our Prussian School System, Cato Policy Report Vol. XV, No. 2, Cato Institute, Washington, DC, March 1993.

4. SA 95: No. 744, p. 480.

5. SA 71: No. 1279, p. 805

6. GB94: Table 6, p. 1161.

7. Parkinson, C. Northcote, The Law and the Profits, Houghton-Mifflin, 1960.

8. For an excellent examination of the forces of the welfare state on Swedish and American society see: Carlson, Allan, Family Questions, Transaction Books, Rutgers, New Brunswick, New Jersey, 1990.