Productivity has roughly doubled since the 1970s. The typical paycheck has barely moved. Someone caught the difference, and it wasn’t the autoworker in Lordstown. Now John Fund, in National Review’s “Is America Slowly Becoming a ‘Transfer’ Nation?”, wants to tell us the country’s biggest fiscal threat is the 68 million Americans collecting Social Security. The piece argues that transfer programs have outgrown their funding — that workers retiring next year will collect roughly four times what they paid in, that 53 percent of U.S. counties now depend on government checks for a quarter of their income, and that without “political courage” the Transfer Nation becomes the Insolvent Nation. The recipients aren’t the problem. The arrangement that manufactured their dependency is.

I’ll grant Fund the numbers he’s most worried about. Social Security’s trust fund is projected to run short in 2032. Medicare’s hospital insurance follows a year later. Pretending those shortfalls don’t exist is a luxury we can’t afford.

But Fund does something more corrosive than hand-waving at the math. He fuses two unrelated things into one indictment: means-tested welfare for the poor, and contributory programs like Social Security and Medicare that nearly every working American paid into for decades. You can’t collect Social Security unless you or your spouse paid payroll taxes for at least ten years. Medicare Part A is funded by the same payroll tax. These are deferred-wage programs, not handouts. Their growth is mechanical. The first big wave of baby boomers reached 65 between 2011 and 2029. There are now roughly 65 million people on Medicare and about 68 million on Social Security. They’re not on the rolls because they stopped working. They’re on the rolls because they got old.

Medicare per-person spending has roughly doubled in real terms since 1990, from $7,000 to $16,000 a year. Fund treats that as evidence of entitlement profligacy. It isn’t. Americans pay roughly twice what citizens of any other rich country pay for healthcare, and the gap has been widening for forty years. A hip replacement that cost $15,000 in 1990 runs $40,000 now. Insulin list prices roughly tripled between 2009 and 2019. Medicare’s own administrative overhead runs around 2 percent; private insurance runs roughly three times that. The cost explosion isn’t Medicare’s fault. It’s that the United States runs the most expensive healthcare system on earth, and then routes a chunk of the bill through a program Fund can blame on retirees — the price tag of being sick in America, paid through an insurance pool that happens to be called Medicare. Medicare can’t fix that alone. A public option could. Single-payer could. Either would cut those per-capita numbers in half while covering everyone — which is what the rest of the wealthy world does.

Social Security’s 2032 shortfall is the easiest fix in American politics, and Fund doesn’t mention it, which tells you what kind of reform he’s actually selling. The payroll tax caps out at well under $200,000 of income. A person earning a million dollars a year pays the same Social Security tax as someone earning the cap. Lift the cap — Bernie Sanders has a version, Mitt Romney has a version — and Social Security is solvent for roughly another seventy-five years, according to the Social Security Administration’s Office of the Chief Actuary. The shortfall isn’t a math problem. It’s a policy choice dressed up as one. Fund has the research staff to know this. He just prefers the framing where the safety net is the villain and the very wealthy keep a tax break.

Now to the counties Fund holds up as evidence of national decline. In 1970, according to the Economic Innovation Group report he cites, less than 1 percent of U.S. counties derived a quarter or more of their income from government transfers. By 2022, 53 percent did. He uses this number as a verdict on the country. He does not, in the entire piece, ask what used to be in those counties. The list is the same: coal mines in West Virginia and eastern Kentucky. Manufacturing in the Ohio Valley and the Rust Belt. Timber in the Pacific Northwest. Sawmills in the piney woods of Mississippi and Alabama. Family-wage jobs that paid enough to support a household without transfers. The transfers arrived because the jobs left. They left because of free-trade policy Fund’s magazine championed, automation his columnists have celebrated as “creative destruction,” and a tax code that made it more profitable to ship production to Mexico than to keep it in Hazard, Kentucky. The safety net didn’t hollow those towns out. The safety net is what’s left of them.

The means-tested programs Fund worries about — SNAP, Medicaid for low-income adults, disability — are a different story, and Fund’s own column quietly concedes the point: 30 percent of Americans receive some means-tested benefit, but “many of them also work.” The fastest growth in SNAP and Medicaid enrollment over the last decade has been among workers whose wages don’t cover rent, childcare, and a family insurance plan. A home health aide in Phoenix making $18 an hour with two kids qualifies for Medicaid in Arizona. A fast-food worker in Texas earning the state minimum qualifies for SNAP. This isn’t a moral collapse. It’s a math problem. When a full-time job at the median wage doesn’t cover housing, healthcare premiums, and childcare, working families need help. The transfer growth Fund laments is downstream of wage stagnation and price inflation in exactly the sectors workers can’t avoid — housing, healthcare, education, childcare.

Here’s where Fund has a point. Labor-force participation has fallen since the pandemic for reasons that aren’t demographic and aren’t about welfare. Disability applications spiked after 2020. Early retirement became attractive for a cohort that hit 60 with a paid-off house and a 401(k) that had done well. Some communities genuinely are work-poor. Fund is right that more people working would ease the fiscal squeeze. He’s wrong that the barrier is moral. The barrier is that the jobs on offer in many of those counties pay less than a transfer check, and the local economies were hollowed out by the consolidation and offshoring Fund’s own policy preferences accelerated for forty years. Telling those communities to “value work more” without fixing the wages, the prices, or the absence of local employers is the policy equivalent of telling a freezing person to be warmer.

The comparison Fund never makes is the one that kills his thesis. The countries with the largest welfare states — Denmark, Sweden, Norway, Finland — also have labor-force participation rates in the high seventies or low eighties. They are not Transfer Nations. They are working nations that have chosen to tax themselves heavily and provide universal services in return. The U.S. labor-force participation rate is low not because workers are lazy. It’s because we let the working economy rot and didn’t build the safety net large enough to make the risk worth taking. In Denmark, losing your job doesn’t end on the street. In America, a single medical bill can end you. The result is millions of older workers who would rather retire early than risk it, and millions of younger workers who can’t afford to quit a bad job because they’d lose the insurance. That isn’t dependency. That is rational risk-aversion in a country that punishes failure.

So what do you actually build? First, let Medicare negotiate drug prices across the board and extend that negotiation to hospital and clinician pricing. The trust-fund shortfall is a healthcare-cost problem wearing a fiscal hat. Other rich countries pay roughly half what we do for the same procedures; closing half the gap covers the trust-fund gap. Second, lift the payroll-tax cap. Social Security’s tax stops at roughly $170,000 of income; removing the cap adds decades of solvency without changing benefits for anyone earning under that. Third, fix the wage problem that drives means-tested enrollment: a higher minimum wage indexed to inflation, universal pre-K and childcare subsidies so a second earner isn’t taxed into poverty, real public investment in housing supply where rents have doubled in a decade. Fourth, pass a real child allowance — the 2021 expanded Child Tax Credit, which the Census Bureau’s Supplemental Poverty Measure showed cut child poverty nearly in half in a single year before we let it lapse, and the poverty came right back. Pass sectoral bargaining rights, the kind Germany has had for decades, so workers can capture some of the productivity they’ve been generating. Stand up public banking the way North Dakota has run it since 1919, in case the private banks stop serving rural America. And stop treating the counties Fund is lecturing at as moral failures to be pitied, instead of what they are: communities that got extracted, and that deserve an answer that builds something on the empty lot.