For many, the election of Barack Obama signified the end of Americas "income inequality" and the beginning of a new era where all would have equal access to Americas vast wealth and resources. Using the presidential podium as a bully pulpit, President Obama has continuously attacked America's free enterprise system while accusing the most successful among us as being greedy, and hoarding excessive profits. The American left, oddly treating the Obama presidency as the second coming, still awaits this magical transformation where we will suddenly become economic equals and gaps in income will disappear. This is despite the many scandals and the fact that Obama's policies are responsible for the massive increase in "income inequality" that the left seems to despise so much. In fact, you could call this a double edge sword because according to John Merline of Investors Business Daily more than 70% of all federal spending is now being paid in the form of direct payments to individuals. In other words, Barack Obama is doing exactly what he said he would; he is spreading the wealth.
"In effect, the government has become primarily a massive money-transfer machine, taking $2.6 trillion from some and handing it back out to others. These government transfers now account for 15% of GDP, another all-time high. In 1991, direct payments accounted for less than half the budget and 10% of GDP." (Investors Business Daily)
While many on the left view this as progress, they may very well be surprised to see who is receiving this money. President Obama has earned a reputation for saying one thing and doing another. Acting like he despises the rich and cares for the little guy is one of these examples. President Obama has given billions to rich executives in the "green energy" sector only to see those business's go completely bankrupt and these billionaire cronies walk away with tax payer money. While Obama has convinced his loyal followers that he is doing all he can to fight income equality and ensure the rich pay their fair share, he exempts his big business buddies like Jeffrey Imelt from paying any taxes at all. In fact, according to this Investors Business Daily article over ten billion dollars of the direct payments are being made to individuals who the left commonly refers to as the, "evil one percent." That's 10 billion from a 2.6 trillion dollar budget.
Where do the rest of these payments go? While many believe Obama is making great progress in alleviating poverty and improving the economy, only 21% of this 2.6 trillion is being used to fund poverty programs. One third of the budget is being used to keep social security benefits going, and at the rate people are attempting to draw social security disability in the face of diminished job opportunities, this number is sure to rise. Government subsidized health; medicare and Obamacare, are making up roughly 38% of these payments and sadly, veterans are only receiving a mere five percent of these direct payments. President Obama has made his feelings about our veterans perfectly clear as he continues to slash away at their benefits and redistribute that wealth elsewhere.
President Obama just released his budget for fiscal year 2015. This plan sees the increase in federal spending rise from 2.6 to 3.9 trillion dollars. While Obama is once again promising billions of dollars in tax hikes to punish the successful and ensure everyone is equal, you really have to wonder what he plans on doing with that money. Based on the above information, many rich people will be getting a great deal richer. This author is in no way an economist; however, it is evident that the more the system is taxed, and the more money that is taken from the individual for the purpose of redistribution, the worse off the economy becomes. You have to wonder what percentage of that 2.6 trillion dollars is being used to pay the massive bureaucracy that has been put in place to redistribute it.