Permit me to propose a welfare program that will expose the foundation of immorality and wrongdoing that undergirds the welfare state way of life. Here’s my proposal: The federal government gives every single American adult an annual dole of $10,000. The money will be free, with no strings attached.
No doubt both conservatives and liberals would enthusiastically embrace my proposal. “You’re a genius, Jacob! That’s an awesome idea! What better way for the federal government to help everyone? And once everyone starts spending the money, there will be an economic revival! This is awesome!”
Well, except for one thing. The federal government is not like firms in the private sector. Unlike Google, Microsoft, or Starbucks, it doesn’t earn its money by selling goods and services to people. How does it get its money? By seizing wealth from people in the private sector. It does this through taxation.
The Alaskan government pays dividends from profits from oil leases to all state residents. This is possible through land being held in public trust to generate revenue. No state income or sales tax.
Of course, all the federal subsidies help, too!