NCPA - National Center for Policy Analysis

Government Dependency is Growing

May 21, 2002

A new study by William Beach of the Heritage Foundation documents Americans' growing reliance on government. While the rate of increase has slowed in recent years, the level of dependency is still climbing - and may be on the verge of another rapid expansion.

The study measures federal spending from 1962 to 2002 in five areas where similar private or community-based services also exist: housing aid, health and welfare support, retirement, post-secondary education and agricultural services.

  • Dependency has grown by 117 percent since 1962 and 38 percent in the last two decades.
  • It has grown 9 percent since George W. Bush took office.
  • The government now spends 5 times as much on retirement programs, 8 times as much on education and 9 times as much on health and welfare as it did in 1962, after inflation.
  • Nearly 27 million people depended on federal government in 1962, while 70.6 million do today - a 162 percent rise, or 3 times the rate of the population growth.

While the rate of growth has slowed recently, it continues. The study estimates it will grow 50 percent over the next 20 years, absent policy changes.

  • The growth was modest at first - even falling during the Kennedy administration 13.4 percent due to drops in federal housing assistance.
  • President Johnson's Great Society brought a 115.6 percent rise in the next six years.
  • Richard Nixon expanded many of Johnson's programs, and the index rose 50.4 percent from 1969 to 1973.
  • The index grew 37 percent under President Ford, 24 percent under President Carter and 16.5 percent under the first President Bush.

The index dropped slightly under Presidents Reagan and Clinton.

Source: Editorial, "Are Americans Too Reliant on Uncle Sam's Handouts?" Investor's Business Daily, May 21, 2002.


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