Values Disconnect: Self-sufficiency vs Entitlement

Family Money Values. One of them for our family is self-sufficiency. I suspect that many Americans value it as well. We pride ourselves on being rugged individualists, able to improvise, invent, and to take care of ourselves and our own.

Yet, in today’s world, there appears to be a disconnect between our cherished value of self-sufficiency and the fact that many of us partake of entitlement programs.

In 2012, US News reported that 4% of us live in public housing, 6% receive low income cash assistance; 11 % use food stamps and almost 25% received Medicaid.

CNN Money, also at the end of 2012, reported that nearly ½ of the American population receives some kind of government check (the study reported included Social Security, unemployment and medicare).

There are veteran benefits; subsidized mortgage programs; Obama Care health insurance; tax breaks (by the way The Heritage Organization reported in 2011 almost 48% of the American population paid NO federal taxes); subsidies for renters; subsidizes for weatherizing your home; school lunch and school breakfast handouts; student loans (along with forgiveness of some); land banks to pay farmers to NOT produce; and on and on and on.

We have become an entitlement society. We are NOT self-sufficient, rugged individualists taking care of ourselves. It hurts, but it is true.

Even if you aren’t in the one-half that receives government aide, you have probably received some form of government assistance, even if it was second hand. For example, has a relative of yours used medicare, received social security payouts, or been on unemployment? If those programs hadn’t been available, who would have provided assistance? Maybe you. So because your relative received payouts from the government, you were able to keep your money in your pocket.

Yes, I benefit from government assistance. My Mom collected Social Security, probably much more that she and Dad paid in. My brother receives housing subsidies. I myself will soon use Medicare and collect Social Security.

I like to think that I am self-sufficient. After all, I paid in plenty over the years to both of those programs, against my will and at the most punitive rates available at the time. Shouldn’t I feel right about taking that money back out?

But, if I suffer one catastrophic event, I will use up all of the money paid into Medicare.

I’ve heard that, on average, a person receives the total dollar amount (NOT adjusted for inflation or the interest you would have earned) of the amount paid into Social Security over their lifetime – within the first 18 months of getting payments from that system.

I did the math on my own paid in amounts vs my expected monthly benefit. According to my 2012 Social Security statement, I’ve paid in $106,619. If I start taking payments at full retirement age (66), in my 4th year I will have gotten back the DOLLAR amount I paid in. However, when you consider the time value of money and inflation, according to some sources, I will not get back the VALUE of the amount I paid in.

Do you feel the disconnect between our cherished value of self-sufficiency and the fact that many Americans benefit from entitlement programs?