1. Spending on entitlements is the highest in American history.
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In 2010, entitlement spending had grown to be almost 100 times higher than it was in 1960; it has increased by an explosive 9.5 percent per year for 50 straight years. Entitlement transfer payments to individuals (such as for income, healthcare, age, and unemployment) have been growing twice as fast as per capita income for 20 years, totaling $2.2 trillion in 2010 alone—which was greater than the entire gross domestic product of Italy and roughly the same as the GDP of Great Britain.
[See a collection of political cartoons on the budget and deficit.]
In 1960, entitlement spending accounted for less than a third of all federal spending; in 2010, it was just about two thirds of government outlays, with everything else—defense, justice, all the other duties of government—making up less than one third. Over the last half-century, income-related assistance (which we used to call “welfare”) multiplied more than thirtyfold after adjusting for inflation. The most shocking growth has been in Medicare and Medicaid. In the early 1960s, neither program existed; by 2010, these two programs cost more than $900 billion a year.
