Welfare Growth, Not Billionaires, Is the Real Burden on the Stagnating Middle Class
Source: Christopher Jacobs. "It's Not Billionaires Robbing The Middle Class, It's Welfare Queens." October 19, 2026. thefederalist.com
The Gist
The author says that while Democrats blame billionaires for squeezing the middle class, government data show that benefits to the poorest households have grown enormously, while the middle class pays for them and sees little income growth. He argues this is the real issue and asks whether such redistribution is affordable or sustainable.
Conclusion
The real threat to the middle class is the perpetual growth of the welfare state and redistribution to low-income households, not the wealth of the top 1 percent, and Democrats' class-warfare rhetoric about billionaires distracts from this and from the sustainability of ever-larger redistribution.
Premises
- CBO data show that from 1979 to 2023, government transfers to the lowest income quintile grew substantially, reaching about $20,000 per household, or roughly 70 percent of their average cash income of about $28,500.
- After accounting for transfers, bottom-quintile income has grown much faster than that of the middle three quintiles, driven mainly by Medicaid and tax-code payments.
- Medicaid spending as a share of low-income households' income rose from 9 percent in 1979 to 48 percent in 2023, and means-tested transfer rates more than doubled.
- Refundable tax credits (EITC, child tax credit, Obamacare subsidies) mean the lowest quintile's average federal income tax rate went from about 0 percent to -11 percent, so the bottom 20 percent barely pay any federal taxes.
- The middle class pays the bills for these programs while its own income has stagnated.
- Democrats focus on inequality and the 1 percent while avoiding questions about how large redistribution will become, whether it is affordable, and whether it is politically sustainable when a fifth or more of the population does not contribute to federal revenue.
Assumptions
- Growth in transfers to the lowest quintile is a cause of, or at least a significant burden behind, middle-class income stagnation.
- The middle class bears the main financing cost of transfers, rather than high earners or deficit financing.
- Not paying federal income and payroll taxes means not 'contributing' to the government, ignoring state, local, and consumption taxes.
- Higher transfers and larger redistribution are unaffordable and politically unsustainable.
- Concern about billionaires' wealth and concern about welfare growth are mutually exclusive or the former is a distraction from the latter.
- Democrats' rhetoric implies policies that would substantially expand redistribution further.