The middle class was created by opportunity and the middle class is being destroyed by entitlement. Unfortunately, all the current politicians campaign on providing more entitlements. The Democrats are biased to providing entitlements to the masses. The Republicans are biased to providing entitlements to businesses and the wealthy. Both parties are biased to providing entitlements (Social Security and Medicare) to the elderly.
The entitlement mentality of the politicians is destroying the initiative and drive that people had to achieve being in the middle class. Now everyone expects it is a right to be in the middle class instead being something that's earned. Here are some common entitlements:
- Higher education. The government provide grants and student loans to people that want to attend college. Unfortunately, some people take out large loans for degrees that are not particularly employable.
- Home mortgage deductions. The current tax code allows for the deduction of home mortgage interest. This may cause some borrowers to take out larger mortgages that they would otherwise do.
- Credits for children. People with incomes below certain thresholds can get Earned Income Credit up to $5751 and a Child Tax Credit of up to $1000 per child.
- Extended unemployment. With 99 weeks of unemployment payments available, some people are choosing staying on unemployment rather than take a job that pays below unemployment compensation. Unfortunately, this is keeping people out of the workforce longer which may make them less employable.
- Business subsidies. There are numerous cases: solar energy subsidies, oil and gas tax credits, GE paying zero corporate income tax, bank bailouts and auto manufacturer bailouts.
Politicians seem to be about giving everybody the entitlement of being middle class. When I see a candidate who supports the right to rise or achieve instead of more entitlements, that person with definitely get my vote.
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This is not financial or policy advice. Please consult a professional advisor.
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