The war over ‘entitlements’
It’s all in the wording. Throughout this presidential campaign, voters have heard a stream of claims and counterclaims about “entitlements” – payments the federal government makes to individuals.
The power of words to frame political ideas can’t be overemphasized. How we label specific practices and proposals affects the ways we think about them. Decades ago statisticians and economists used a neutral phrase, “transfer payments,” to describe various government disbursements: unemployment assistance, old-age pension support, food for the hungry, disbursements to veterans and federal employees.
By calling these “transfer payments,” they sought to focus on accounting techniques. They wanted to avoid the kind of charged labeling and stigmatization that we see today -‑ which prevents thoughtful discussion of the effects and benefits of these practices.
Now, amid a divisive presidential campaign, no such circumspection about word choice exists in the public debate about economic and social policies. Political leaders today use words that distort rather than illuminate, provoke rather than inform.
Liberals speak passionately about commitments to working people and those in need, all of whom are “entitled” to disbursements either earned or sought. Conservatives, in contrast, question not only the justification for such payments but also the sustainability of programs that seem to grow inexorably and exponentially over time.
Republican presidential nominee Mitt Romney captured the essence of this dispute with his comments during a fundraiser about the “47 percent of the people who are dependent upon government … [who] should take personal responsibility and care for their lives.”
The torrent of fierce commentary his words provoked speaks volumes about the power and impact of the notion of “entitlements.” This word is a peculiar historical product, the exact opposite of the phrase “transfer payments” which was developed decades ago as an impartial construction to defuse the charged atmosphere in the national debate about federal spending on individuals.
By the Nixon administration, the rapid growth in the cost of programs like Social Security and Medicare had created a conservative backlash. Debates flourished about the growth in domestic government spending. More and more political leaders and journalists began to speak of “entitlements” in the national budget. The word comes freighted with powerful meanings and connotations.
Ronald Reagan accelerated this shift with rhetorical sleight-of-hand in the 1980s. The Reagan administration sought to dismantle a variety of Great Society and New Deal programs. In the Great Communicator’s speeches, a technical description of a part of the federal budget morphed into a pejorative labeling of the purpose of federal spending itself.
By referring to programs like Social Security and Medicare as “entitlements,” conservatives were able to evoke notions (and suspicions) of people unworthy of support, guzzling at in the public trough. Just as important, if one could be “entitled” to something, one could arguably be “unentitled.”
With this, conservatives found it easier to speak of social program elimination, zero-based budgeting, means-testing Social Security and an array of efforts at fiscal contraction literally unthinkable a decade or so earlier.
Yet many on the left also embraced the use of “entitlements.” They wished to make the case that certain payments to individuals should be reckoned as rights rather than privileges.
Our discourse on these matters has now turned completely upside down. Senator Marco Rubio (R-Florida) demonstrated this change when he railed against “entitlement programs” in a speech last year at the Reagan Presidential Library. “These programs,” Rubio claimed, “[have] actually weakened us as a people.”
The phrase “transfer payments” grew out of an early 20th century effort to revise and strengthen federal government reporting of economic information. The creation of the national income accounts, the system of ledgers and categories that provide for the systematic reporting of gross domestic product and other key variables of economic performance, is relatively recent.
It was a Republican, Herbert Hoover, serving as one of the nation’s first commerce secretaries, who identified the need for modern budgeting practices in Washington.
The revision and elaboration of national economic and social statistics was, for Hoover, essential to a well-functioning economy. Only if the government provided accurate, reliable and timely economic data would markets function in the optimal and efficient ways crucial to balanced, equitable and robust growth.
Indeed, thanks to Hoover, the U.S. government has, for decades, been known for a standard of excellence in data gathering that most foreign governments and international agencies still envy. Yet nowhere in Hoover’s commerce data, or for decades after in the federal government’s formal accounts reporting, would one ever find reference to “entitlements.”
On the contrary ‑ all disbursements to individuals that involved the redistribution of revenue from any source were known as “transfer payments.” Such allocations included Social Security, unemployment compensation, Medicare, Medicaid, aid to families with dependent children (including food stamps), military pensions and federal employee pensions. The key issue in identifying these funding allocations has always been that they neither absorb nor create output — they simply transfer resources from one entity (the federal government) to another.
Calling these disbursements from the federal budget “transfer payments” categorized them in a technical manner that was intentionally devoid of political content and ideological implications.
It was a sage lost to the ages who commented that the left thinks with its heart, the right thinks with its stomach. Yet inspired public policy requires that we think with our brains. That tremendously challenging and difficult task begins with words and with the names we choose to give to the things we do ‑ and the future toward which we aspire.
PHOTO: President Ronald Reagan hastened the shift from the neutral “transfer payments” to the more freighted word, “entitlements.” Mal Langsdon / Reuters