William Beach has just written a report for the Washington, D.C.-based Heritage Foundation titled "The 2005 Index of Dependency." Between 1962 and today, American dependence on government has more than doubled and shows little sign of abatement. The growth areas of dependency examined in the report are: welfare and medical care, housing, retirement income, education, and rural and agricultural services. The budgetary impact of dependency threatens perpetual budget deficits and high taxes, but to focus only on the budgetary impact is to trivialize the more devastating aspects of dependency.
Some of this has been commented upon by University of Texas professor Marvin Olasky in his 1992 book, "The Tragedy of American Compassion." One of the results of the growth of dependency on government is what Professor Olasky calls the charitable equivalent of Gresham's Law -- where bad charities drive out good charities.
Consider two options for a homeless family. A church or some other non-governmental entity might offer a homeless family shelter in return for the family's performance of chores such as cleaning the kitchen, mowing the lawn and washing windows. By contrast, a shelter financed by the government might provide that family shelter with no such obligation. The natural tendency for many homeless families would be to opt for the shelter where they have no obligation to give back. The Gresham's Law feature of this is the displacement of charity from the local and private level to the state, where all too often the state is unwilling or unable to distinguish between deserving and undeserving need.