Rescuing Blacks from the Slavery of Dependency

Dick McDonald Ownership Society Institute

On his program yesterday Fox’s Glen Beck was criticizing Democrats for the debilitating effects of big government dependency on the African American community. One of the all-black panelists put forth the idea that the disintegration of the black family may have been the root cause for the increase in dependency inasmuch as only 20% of black children were born out of wedlock in 1960 whereas today that figure has sky rocketed to 80%.

Glen noted that Bill Cosby had brought this up before but got hammered for it. He asked Brandon Brice (a community organizer and a Republican) for his comment. Brandon opined that Cosby had called for black males to be more responsible - he then made a 360 departure, changed the subject and said the following:

The more important thing when we look at things as Republicans and conservatives and when we talk of the fear of big government we have to remember that big government whether you like it or not - it’s the perceived notion that they are taking care of much of low income America right now especially at this time of depression. Maybe the solution should be a smarter and more responsible government and I believe that if that happens what you will have – you will shift to automatically smaller government because it will be based on principle. Right now much of the low income neighborhoods are dependent on this so you can’t speak against something that is supporting the lower masses whether you like it or not.

The community organizer hit it right on the head. Unfortunately it flew right over Beck’s. Brice opined that a smarter government would use principled legislation which would naturally result in a smaller government. Voila- an economic solution to poverty. That is what our Founders bequeathed to us. If the government were smaller the taxes taken from the people wouldn’t be so great and they could use that extra money to grow the economy and create and compound their own wealth.

Unfortunately instead of pursuing an economic line of reasoning Beck and the panel headed off into a rehash of the “social” effects of dependency. They eventually compared the black community to domesticated dogs who had to rely on their owners because they were never taught how to survive on their own. What a sad analogy – and from an African-American panelist yet.

The panel didn’t pursue how being smarter and more principled could possibly lead to an “economic” solution to poverty and the eradication of this endemic condition in so many parts of the black community. It was just another chance Beck missed to uncover a solution – a wall he butts into almost daily.

To change a cultural dynamic like poverty you have to have a reason for blacks to make a change. So why in the world would the black community presently vote for Republicans when Republicans have nothing to offer but the admonition to be “responsible”? Do Republicans believe they can shame blacks into voting to cut off their free food, free housing and free health care by proving that Democrats are corrupt capitalists posing as socialists? It hasn’t worked in the past and it won’t work in the future save a massive change in the Republican political arsenal. Today Republicans are not even a perceived threat to blacks as they have been accommodating blacks for years by appeasing the entitlement cabal that has run up a $118 trillion debt.

So what is a smart principled legislature? Well it is one that knows a $118 national funded and unfunded debt is unsustainable and moves to extinguish at least the $110 trillion portion that represent entitlements. It would repeal and replace entitlements (or the “free stuff”) with programs that use capitalist principles to eradicate poverty, lower taxes and increase benefits. No matter how daunting a task this appears to be on the surface, it is doable today without sacrificing the relatively paltry benefits government presently doles out in entitlements nor cost a dime more than the taxpayer presently pay. The people would continue to be paid their full entitlement benefits required by law today as they would be legislated as a “safety net” under which no future benefits would fall. .

Increasing benefits like Social Security’s monthly check from $1,000 to $33,000 seems like a pipe dream. How could a legislature do that? Actually it can be done quite simply by removing the government from the equation - by privatizing Social Security, Medicare and Disability and letting the taxpayer keep the 15.3% in payroll taxes presently confiscated from him or her and letting them use those funds in a personal investment account to grow and accumulate over the years into a nest egg. Let’s take a simple example.

The average American household presently makes over $50,000 a year. That means they pay over $7,500 a year in payroll taxes. Over a 40-year working life that $7,500 amounts to a contribution of $300,000 to the government for which the taxpayer gets no nest egg. However, if those payroll taxes were the taxpayer’s own money and invested weekly in the stock market for 40 years the average nest egg accumulated would be $4,000,000. Just the earnings off the $4 million in the 41st year would equal $33,000 a month.

If you doubt these figures go to the tables on www.riseupamerica.us and review them. Even low-income taxpayers will end up with million-dollar nest eggs and tens of thousands in monthly retirement checks. As a policy matter individual and national wealth will accumulate and grow as it is willed from one generation to the next. We call the plan the Rise Up America plan (RUA) and the personal investment account a “USA” - universal savings account. It will end endemic poverty in the black community.

RUA and the USA are the type of tools it will take to motivate blacks to vote for Republicans and vote for capitalism. Today we have blacks like Oprah Winfrey mistakenly touting Denmark and its socialist government as the answer black Americans are looking for. When the richest black woman in America who has reached that pinnacle through her understanding and use of capitalism starts promoting socialism Republicans should wake up to the fact that they need to offer the black community more than an encouraging word to be more responsible. They need a pocketbook issue like RUA. It can be the one that ends black dependency on government.