Obama Will Spend More on Welfare in the Next Year Than Bush Spent on Entire Iraq War, Study Reveals
September 22, 2009As a candidate for president, Barack Obama decried the financial toll that the Iraq war was taking on the economy, but Obama's proposed spending on welfare through 2010 will eclipse Bush's war spending by more than $260 billion.
“Because of the Bush-McCain policies, our debt has ballooned,” then-Sen. Barack Obama told a Charleston, W.V., crowd in March 2008. “This is creating problems in our fragile economy. And that kind of debt also places an unfair burden on our children and grandchildren, who will have to repay it.”
During the entire administration of George W. Bush, the Iraq war cost a total of $622 billion, according to the Congressional Research Service.
President Obama’s welfare spending will reach $888 billion in a single fiscal year--2010--more than the Bush administration spent on war in Iraq from the first “shock and awe” attack in 2003 until Bush left office in January.
Obama’s spending proposals call for the largest increases in welfare benefits in U.S. history, according to a report by the Heritage Foundation, a conservative think tank. This will lead to a spending total of $10.3 trillion over the next decade on various welfare programs. These include cash payments, food, housing, Medicaid and various social services for low-income Americans and those at 200 percent of the poverty level, or $44,000 for a family of four. Among that total, $7.5 trillion will be federal money and $2.8 trillion will be federally mandated state expenditures.
In that same West Virginia speech last year, Obama said, “When Iraq is costing each household about $100 a month, you’re paying a price for this war.”
The Heritage study says, “Applying that same standard to means-tested welfare spending reveals that welfare will cost each household $560 per month in 2009 and $638 per month in 2010.”
The welfare reform package of 1996 only targeted one program, which was Aid for Families with Dependent Children, pushing work requirements for recipients to encourage them to get off the rolls. There are still 70 different welfare programs spread across 14 different federal agencies, said Robert Rector, senior research fellow in domestic policy studies at the Heritage Foundation, who co-wrote the study.
“The average person says I thought we ended welfare. Well, it’s a good thing we ended it, otherwise we’d be spending some real money,” Rector joked while speaking about the report on Tuesday. “Reform was grossly oversold by Clinton and the Republicans. It reformed one program out of 70. Medicaid, public housing, the Earned Income Tax Credit were not reformed.”
According to his White House budget proposal, President Barack Obama will increase annual federal welfare spending by one-third, from $522.4 billion to $697 billion in his first fiscal year. Adjusted for inflation, the combined two-year increase of $263 billion is greater than any increase in welfare spending in history.
By 2014, annual spending on welfare programs will reach $1 trillion for the fiscal year.
“One in seven in total federal and state dollars now goes to welfare. But this is a completely unknown story,” Rector said. “This is not being reported. No one knows Obama is spending $10 trillion on welfare.”
Welfare spending has taken its toll on the federal debt. Since the beginning of the “war on poverty,” $15.9 trillion has been spent on welfare programs. The total cost of every war in American history, starting with the American Revolution, is $6.4 trillion when adjusted for inflation.
Welfare has been the fastest growing part of the federal government’s spending, increasing by 292 percent from 1989 to 2008. That’s compared to Social Security and Medicare, which grew 213 percent, the study says.
Adjusted for inflation, welfare is 5 percent of the gross domestic product today. It was only 1.2 percent of GDP in 1965, the report says. Also, over the next decade, $1.5 trillion in welfare benefits will be paid to low-skilled immigrants.
Still, high levels of poverty are reflected by the U.S. Census Bureau because the bureau counts only 4 percent of the total welfare spending as income when it calculates poverty. Thus, most discussions on poverty begin on the virtual premise that welfare does not exist, the study says.
“None of the $800 billion being spent is counted as income, so the Census comes back and they say, ‘Oh my goodness, we have 40 million poor people. We need to spend more money,’” Rector explained. “That is a game the taxpayer can never win.”
Changing how the money is spent could go a long way in achieving better results, the study says.
“Annual means tested welfare spending is more than sufficient to eliminate poverty in the United States,” the study reports. “If welfare spending were converted into case benefits, the sum would be nearly four times the amount needed to raise the income of all poor families above the official poverty line.”