Everyone compares what happened during the Great Depression to what we are experiencing now in the current fiscal state of the economy. It’s an interesting comparison, but you are comparing two extremely different environments; this should always be pointed out.
First of all, social programs are much more prevalent now. They’re in place now to be safety nets for the number who increasingly fall through the cracks of the economy during recessions. Unemployment benefits, EBT cards, and welfare programs exists now which did not exist in the 1930s. People don’t see bread lines and thus assume the times aren’t as bad, but the truth is that we’ve become more sophisticated where the government can now deposit money right into people’s accounts so that they can purchase food and sustain themselves during these harsh economic times. You would not know someone is living on handouts unless you observed what kind of card they just swiped at the grocery checkout counter.
Speaking of how bad things are right now, one out of every six Americans are on foods stamps according to a recent article published by CNN. An article by the USDA has this number as high as one in five Americans as of 2013 data. This chart below shows how dramatic the rise has been over recent years proving how essentially the bread lines in America are getting longer and longer.
The age old debate is deciding whether these social programs are really helping people or that we’re better off without them. Obama seems to think that these programs actually help the economy along with all of the other government nonsense that he’s always trying to push forward. In terms of the way he does his math, he should be very proud of the fact that 23 million households in America are on food stamps boosting the economy.
Unfortunately this snowball of Americans on government programs is out of control and only getting worse. To someone who understands human nature and common sense, you know that dead weight doesn’t add value to an economy. In fact, it only causes it to slow down and drag, making it difficult to recover. Beyond that, taking into consideration that we are in over our heads trying to just maintain government’s current expenses, this situation can only spiral and make matters worse really fast.
Being that these socialist programs did not exist during the Great Depression, it seems more likely to me that we will be in this recession type economy even longer than what America saw in the 1930s. The dead weight of government and social programs were at fractions of what they are at today.
The argument for a socialist society is the immediate benefit that people get and the help that hurting families have to draw from. The long-term reality is that socialism makes people poorer across the board, an overall bad thing for a nation. It usually takes a self-sufficient and responsible mindset to be able to understand this philosophy and apply it in one’s life.
Now we are in a scenario where our social programs are perpetuating themselves. The question of course is when will this entire thing implode? Looking at the chart and the velocity in which the government is expanding, one can only assume that this day will be sooner rather than later.
Even so, don’t be surprised on the day of an actual collapse if the free market gets blamed and more social programs are offered as the fix to an already broken mentality. It truly is the people in power leading the blind. Do not put your faith in the government because you will inevitably be disappointed. Instead, step out for yourself and forge a path that you want to live.
Chief Editor of CrushTheStreet.com