Opinion / Politics

Should the Government Pay More for Social Services?

healthThe term “social determinants of health” is trending in health policy circles. The general theory is that addressing external factors can improve an individual’s overall health. This seems logical. However, using this term to advocate for a new set of government programs and more government spending is not the answer. Here are some basic questions that should be answered.

Do these efforts to address social determinants of health overlap with existing programs and initiatives?

There is a massive safety net of government programs aimed explicitly at improving the welfare and well-being of individuals. More than 90 government programs scattered across various federal and state agencies provide a broad set of services to the poor, including cash, food, housing, medical and social services.

Efforts aimed at addressing social determinants of health should start with conducting an inventory of existing programs and the services they provide, including identifying where there is overlap, before layering new programs on top of existing ones.

Do these efforts to address social needs result in more spending?

Tethered to these government programs is government funding. Arguments for more upfront spending to achieve long-term savings is a fool’s errand. Rarely do new “investments” result in actual savings. There is already an abundance of money available. The federal and state governments collectively spend roughly $1 trillion to help the poor.

Advocates for spending more money on social determinants of health should first inventory funding streams associated with these programs. Some programs, such as those providing social services, already have funding flexibility. Rather than adding new funding streams, current resources should be spent more wisely.

Moreover, combining funding resources should not be exploited to facilitate new spending. Efforts to address social determinants of health by “maximizing” funding opportunities and, in particular, leveraging the Medicaid program to do so are troubling.

Unlike some other social welfare programs, Medicaid is an open-ended source of funding—i.e., the more services delivered, the more spending is allowed and required. Therefore, efforts to address social determinants of health should not be a backdoor way to add new spending through Medicaid.

Years of adding new programs and spending on top of old have created a complicated bureaucratic maze that has lost sight of individuals and their needs. Broadly speaking, organizing assistance around the whole person rather than through programmatic silos makes some practical sense. However, layering new initiatives and spending on top of existing programs ignores current programs and spending.

Reprinted with Permission from - Heritage Foundation by - Nina Owcharenko Schaefer

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Carla Butler
8 months ago

Absolutely not. People are being to dependant on the government. A person appreciates what he has more by working and earning for himself. Government must spend less and stop printing money they do not have backed.

PaulE
8 months ago

No new government programs! We, as a nation, can no longer afford them or to keep adding to what is already a broad array of welfare programs disguised as “social services”. If people want to just live off a government check for every single, little thing, at least be honest enough to say so. That is what the left is pushing Universal Basic Income (UBI) for. No one works and everyone magically gets a $2,000 check every month from the government tooth fairy. I guess the idea is the rest of the world will give us monthly welfare checks, so we can sit home and watch Netflix all day. Yeah, that’s the ticket.

The number of truly needy people that require ongoing government financial assistance is actually quite small compared to the number that actually end up receiving it. As we fly past $30 trillion in national debt and $156 trillion in unfunded liabilities (yes those are all TRILLIONS people), the idea that we can continue to create new “social welfare programs” or significantly expand our existing ones is ludicrous. The first time one of our Treasury auctions fails to be fully purchased by the regular foreign buyers that buy our ever more worthless paper, is the day this house of cards begins to implode in on itself.

Nick
8 months ago
Reply to  PaulE

Did you know that the Pentagon has $21 trillion in unaccounted-for spending? Maybe a good first step would be cutting the DOD budget until they reconcile some of that.

PaulE
8 months ago
Reply to  Nick

I’m for scaling back ALL wasteful or redundant federal spending across the board. None of this lets gut the DoD budget first and then we’ll talk about the social welfare programs down the road. I’ve been around long enough to know how that old trick works. National defense is one of the few areas that is actually essential, unlike the majority of social welfare programs.

However, the DoD is like any other federal agency in that there are many programs that no longer serve the national defense interest, but continue to be fully funded year after year. The actual figure is however about $400-$450 billion in “off book” spending (black ops and so-called special projects spending), not $21 trillion.

I know many on your side think that all the freebies that Bernie, AOC and the rest of the progressive wing of the Democrat Party are promising could all be financed if we just slashed the Defense budget to zero. Sorry but even if you zeroed out the $800 billion a year from the federal budget and re-captured the sunk costs for the off book spending, you would still be several trillion of dollars a year short of what is needed to fund the myriad of programs they have promised you.

Our total federal budget is currently around $4.6 trillion a year and 55 percent of that amount comes from Treasury sales to foreign buyers. In essence we are paying for 55 percent of our existing annual federal spending with borrowed money from abroad. The interest we have to pay to these countries and individuals annually is currently costing us between $550-$600 billion. Even in this ultra low interest rate environment. If interest rates were to rise to “normal” levels (4 to 5 percent), our annual interest payments would balloon to almost $2 trillion a year, necessitating massive across the board tax hikes on everyone. Which would depress the economic output of the country accordingly. That is why the Federal Reserve has been so accommodative with ultra low interest rates for so long.

The cost of all the new programs you’ve been promised come to an additional $8-$12 trillion annually. So our annual federal budget would rise to between $12.6-$16.6 trillion. The total domestic GDP output of the United States is $22 trillion a year. With the enactment of the regulatory and increased tax policies that your party has outlined, the annual GDP would fall to approximately $17 trillion. Expressed in individual terms, if you spent 100 percent of all the money you make each and every week just to pay your existing bills, that doesn’t leave anything left over for anything else. It is not like the foreign appetite for our Treasuries will simply triple or quadruple to fill the gap.

The United States is already having problems finding enough buyers for our existing Treasury auctions. So to attract more buyers, we would have to offer substantially higher interest rates. That in turn would be a self-defeating exercise, as a substantial amount of the money raised would have to be earmarked for interest payments to the same foreign buyers. Which in turn would then require even more Treasury sales to generate the revenues needed for current government spending. It’s called the principle of diminishing returns, where we have to sell ever more worthless government paper to try and cover current expenses while ballooning our annual interest payments to our creditors. See Greece, Argentina, Venezuela, Zimbabwe and numerous other countries that went this route. It doesn’t end well to say the least.

Last edited 8 months ago by PaulE
Kim
8 months ago
Reply to  PaulE

A picture of the national tooth fairy comes to mind: A colorful poster of a Gulliver-like toothless Uncle Sam, handing out wads of cash to people driving SUV’s, holding smart phones, and eating Chinese take-out.

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